Wednesday, 30 September 2015

Has Atlas Merchant Capital LLC Bought A 25% Stake In A Rotten Lemon In Ghana For US$50 Million?

If Robert ("Bob") Diamond, Atlas Merchant Capital LLC's (AMC) founder and CEO, learnt any lessons from Barclays Bank's involvement in the Libor (London Inter-Bank Offered Rate) rigging scandal, his Africa-focused investment vehicle, AMC, would walk away from the acquisition of a 25 percent stake in Ghana's corruption-riddled  Agricultural Development Bank (ADB).

The simple question that Bob Diamond and his AMC partner Ashish Thakker must answer is: Would they acquire a stake in a UK bank, whose board and managing director, were alledged by concerned staff members, to have sold that bank's residential properties to themselves at fire-sale prices, and, worst of all, of making sundry disloyal payments?

Let them also ponder the deafening silence of the Mahama administration, which has studiously avoided speaking out against the scandalous activities of those in charge of the ADB - a state-owned entity in which by all accounts ethics and corporate good governance principles are sadly absent from.

To quote an old wag I am acquainted with: "'There's a reason for the silence and inaction of the Mahama regime and regulators. The ADB is a bank run by crooks for the benefit of powerful crooks - to whom politicians are beholden. That bank  needs a forensic audit. Its loan book would make very interesting reading."

If this were the UK, the bank's staff members' serious allegations  would have been promptly investigated by regulators and the police - leading to the prosecution of some of the ADB's board members and senior management: who would definitely be jailed and banned for life from ever becoming company directors for neglecting their fiduciary duties in such egregious fashion.

What kind of questionable judgment, leads a bank's management to blatantly misuse what is a struggling state-owned bank's money, for PR purposes - aimed at creating a favourable impression in the minds of Ghanaians, about their stewardship of the ADB: by paying all manner of dubious individuals and praise-singing groups to speak out favourably about the ADB IPO? Why the desperation?

Atlas Merchant Capital might have paid a bargain price - equivalent to a little over  two years of  Bob Diamond's total annual compensation package during the boom years - but Bob Diamond and Ashish Takker will eventually discover, much to their discontented shareholders' chagrin,  that they bought a 25% stake in a rotten lemon in Ghana, run by shady characters for US$50 million. Pity.

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